Accounting ________________________________________ During the fiscal year ended December 31,… 1 answer below »

Accounting ________________________________________ During the fiscal year ended December 31, Swanson Corporation engaged in the following transactions involving notes payable: Aug. 6 Borrowed $12,000 from Maple Grove Bank, signing a 45-day, 12 percent note payable. Sept. 16 Purchased office equipment from Seawald Equipment. The invoice amount was $18,000, and Seawald agreed to accept, as full payment, a 10 percent, three-month note for the invoice amount. Sept. 20 Paid Maple Grove Bank the note plus accrued interest. Nov. 1 Borrowed $250,000 from Mike Swanson, a major corporate stockholder. The corporation issued Swanson a $250,000, 15 percent, 90-day note payable. Dec. 1 Purchased merchandise inventory in the amount of $5,000 from Gathman Corporation. Gathman accepted a 90-day, 14 percent note as full settlement of the purchase. Swanson Corporation uses a perpetual inventory system. Dec. 16 The $18,000 note payable to Seawald Equipment matured today. Swanson paid the accrued interest on this note and issued a new 30-day, 16 percent note payable in the amount of $18,000 to replace the note that matured. Instructions a. Prepare journal entries (in general journal form) to record the above transactions. Use a 360-day year in making the interest calculations. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1.(aug. 6)Record the borrowing of $12,000 note payable from Maple Grove Bank @ 12% per annum. 2. (Sep. 16th) Record the issue of 3-month, 10% note to Seawald Equipment as payment for office equipment. 3. (Sept. 20th) Record the payment of notes payable with interest 4. (nov. 1) Record the borrowing of $250,000 by issuing 15%, 90-day note payable 5. Dec 1.) Record the purchase of merchandise by issuing 90-day, 14% note payable to Gathman Corporation 6. (Dec 16) Record interest and note to Seawald Equipment which matured today and issuance of 30-day, 16% renewal note. Prepare your answers as a compound journal entry. Prepare the adjusting entry needed at December 31, prior to closing the accounts. Use one entry for all three notes. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Round your answers to the nearest dollar amount. 1. (dec 31) Record the interest accrued on notes payable.

 

Looking for a Similar Assignment? Let us take care of your classwork while you enjoy your free time! All papers are written from scratch and are 100% Original. Try us today! Use Code FREE15